Letshego Holdings, the BSE-listed micro-lending giant, is aggressively leveraging product diversification as a cornerstone of its transformation strategy. Moving beyond its traditional Deduct at Source (DAS) business model, the company has introduced a suite of lower-risk products to complement its robust lending portfolio.
New products include payment capabilities, additional savings products, insurance solutions, and a value-adding lifestyle solution that provides customers registered on the LetsGo Digital Mall with access to information and tools to support their everyday needs. This strategic shift, detailed in the companyโs December 2023 Year-End Annual Report, underscores Letshegoโs commitment to becoming a more inclusive, digital-first provider of retail financial services.
ย Group Chief Executive Officer, Aupa Monyatsi acclaimed in his statement on the 2023 Year-Ended Annual Report for Letshego Holdings, that product diversification continues to be a cornerstone of their strategic approach, driving innovation and resilience in their offerings.ย โProduct diversification remains a key strategic pillar and evidence of success in this area was a resounding 307 percent year-on-year increase in mobile lending income. We also meaningfully grew customer deposits and insurance revenue as we seek to cautiously diversify, while not neglecting our core Deduction at Source (DAS) business.โ
This strategic repositioning is not merely about expanding product lines, but also about tapping into underserved market segments such as the mass, middle-income, and SME sectors. To accelerate the diversification efforts, Letshego has forged strategic partnerships with fintech firms and mobile network operators, facilitating the rapid deployment of new and relevant financial solutions.
The companyโs diversified portfolio now spans five key value streams: Lending (LetsGoBorrow), Savings (LetsGoSavings), Payments (LetsGoPay), Insurance (LetsGoInsure), and Lifestyle (LetsGoLive) with each stream tailored to meet specific customer needs, from flexible loan products and competitive savings accounts to secure digital payment solutions and comprehensive insurance offerings.
LetsGoBorrowย offers a diverse range of loan products aimed at promoting responsible and productive use of funding. Their core offering includes Deduction at Source (DAS) loans, designed primarily for government employees with repayments deducted from salaries, ensuring low-risk lending.ย
LetsGoSavingsย extends savings through a variety of accessible and competitive interest-bearing accounts. The Flexi-Save Account, available in Ghana and Namibia, offers digital access with competitive interest rates. In Tanzania, the Timiza Akiba mobile money savings account, available to Airtel Mobile Money customers, offers a fee-free solution and rewards customers monthly for achieving savings goals.ย
LetsGoPayย enhances payment convenience and security through its LetsGoPay Digital Account, which supports expanded transactional capabilities for customers. This digital account facilitates USSD payments, money transfers, and savings and borrowing services across six markets, ensuring ease and efficiency anytime, anywhere.ย
LetsGoInsureย prioritises risk mitigation through a robust suite of insurance offerings, complementing their loan products. Credit insurance is integrated into repayment terms across all markets, providing added security for borrowers. They also provide short-term digital insurance products such as funeral and motor cover in six markets, ensuring quick access and transparent claims resolution. In select regions, Letshego offers long-term standalone insurance options like education insurance in Nigeria, alongside non-digital products such as term life insurance in Botswana and motor insurance in Mozambique. These comprehensive insurance solutions aim to provide affordability, simplicity, and transparency to protect customers against various risks effectively.
Lastly,ย LetsGoLiveย goes beyond traditional banking by integrating essential lifestyle solutions with financial services to deepen customer engagement and loyalty. The Digital Wellbeing initiative offers customers access to online health, wellness information, and lifestyle solutions across nine markets. This holistic approach aims to enhance customer satisfaction by addressing not only financial needs but also contributing to their overall well-being and quality of life. By blending these offerings, Letshego seeks to create tailored and impactful solutions that resonate with its diverse customer base, fostering long-term relationships built on trust and mutual benefit.
Looking ahead, Letshego plans a strategic consolidation of its mobile loan offerings to enhance operational efficiency and expand into new markets. They aim to strengthen payment capabilities across e-wallets and cards, integrating with partners for value-added services and utilities. The focus will also be on expanding affordable housing loans in Namibia and Botswana through collaborations with development funding institutions. Letshego intends to deepen partnerships in the mobile network operator sector and credit data space to drive deposit growth and secure transactions.ย
Additionally, they will bolster retail savings through strategic alliances, while advancing their insurance business through cell captive arrangements across all markets to boost earnings and enhance customer value propositions.
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